The Sudden Shutdown of Bench Accounting: What Happened?
On December 27, 2024, Bench Accounting, a Canadian-founded accounting startup that once served over 35,000 U.S. customers, abruptly closed its doors. Customers, investors, and industry professionals were caught off guard by this unexpected announcement. A notice on Bench’s website informed users that the platform would no longer be accessible, urging them to download their data by December 30, 2024, and find alternative bookkeeping solutions.
What Happened to Bench Accounting?
Founded in 2012, Bench aimed to simplify bookkeeping for small and medium-sized businesses through a software-as-a-service model. Backed by high-profile investors like Shopify, Bain Capital Ventures, and IT giant Sage, the company had raised $113 million over its lifetime, including a $60 million Series C round in 2021. Despite its promise and growth trajectory, the startup’s sudden closure has left thousands of customers scrambling to find solutions.
A Lack of Transparency
Bench’s closure has raised more questions than answers. The company has not provided any public explanation for its decision, leaving many to speculate about financial instability or management missteps. Ian Crosby, Bench’s co-founder and former CEO, took to LinkedIn to express his disappointment. Crosby, who left the company after being replaced by a "professional CEO," criticized venture capitalists for pushing founders out of their companies, claiming that such decisions often lead to failure.
Acquisition Announcement
Just days after the Bench Accounting shutdown, TechCrunch reported on December 30, 2024, that Bench will be acquired by Employer.com, a San Francisco-based HR tech company specializing in payroll and onboarding, for an undisclosed price. Employer.com’s chief marketing officer, Matt Charney, confirmed that the company plans to revive Bench’s platform and provide instructions for customers to log in and access their data. Customers will have the option to either port their data to another service or continue using Bench under its new ownership.
According to Employer.com, Bench’s previous recommendation to file for a six-month extension with the IRS is no longer necessary for customers who choose to stay with the platform. The company’s CEO, Jesse Tinsley, has assured users that they will continue to work with the same in-house bookkeepers and will benefit from Employer.com’s resources and enhancements.
Employer.com, a self-funded startup, acquired the domain name in November 2024 and has been actively expanding its HR-related services. While Bench’s website remains offline, an archived copy listed over 35,000 U.S. customers, although Employer.com later clarified that the actual number is closer to 12,000. Jennifer Bouyoukos, Bench’s chief people officer, confirmed that the company is beginning to recall some of its 600 employees to ensure continuity of services.
Customer Fallout
Bench’s abrupt shutdown has been devastating for its users. Justin Metros, the co-founder and CTO of Radiator, shared his frustration, stating that years of his company’s financial documents are still stored on the platform. Other customers voiced their anger on social media, with one noting they had just migrated from QuickBooks to Bench before the announcement.
Adding insult to injury, Bench’s original notice advised customers to file a six-month extension with the IRS while seeking a new bookkeeping partner. However, Employer.com’s acquisition and revival of the platform aim to alleviate these disruptions. Matt Charney emphasized that Bench customers can now access their accounts and continue their services without interruption.
Lessons for Startups and Their Clients
Bench’s story is a cautionary tale for startups and their clients. For startups, it highlights the dangers of misaligned priorities between founders and investors. Crosby’s critique of his ouster underscores the potential pitfalls of replacing a founder with external leadership, particularly when the company’s culture and vision are closely tied to its origins.
For clients, Bench’s sudden closure is a stark reminder of the risks of relying heavily on third-party platforms for critical business functions. Businesses must ensure they have contingency plans in place, such as regular data backups and diversified vendor relationships, to mitigate the impact of unforeseen disruptions.
Looking Ahead
As the dust settles, the focus shifts to Bench’s customers, employees, and the broader startup ecosystem. Employer.com’s acquisition and efforts to onboard Bench’s former users may provide some relief, but rebuilding trust will take time. For the hundreds of Bench employees who lost their jobs, the future remains uncertain.
Bench’s abrupt shutdown and subsequent acquisition will undoubtedly reverberate through the startup world, sparking discussions about governance, transparency, and companies' responsibilities toward their customers. While its closure marks the end of an era for one company, it offers valuable lessons for the industry as a whole.
About
Nex CPA is a boutique Canadian digital accounting firm that provides online accounting solutions by combining technology and forward-thinking businesses. Tailored for the modern entrepreneur, we provide an easy, automated and client-focused service so you can focus on working 'on' the business and not 'in' the business.
For more information, please contact us at info@nex.cpa.
Bench Accounting Shutdown What Happened to Bench Accounting
コメント